Trading in NFTs spiked 21,000% to top $17 billion in 2021: Report
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On January 25, 2022, people walked by the Bored Ape Yacht Club NFT signboard at Times Square.
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A new report by Nonfungible.com shows that sales of nonfungible tokens rose to over $17 Billion in 2021.
L’Atelier is a BNP Paribas-owned research agency that developed the study. It found that NFT trading reached $17.6 Billion in 2015. This represents a 21,000% rise over 2020’s $82 Million.
NFTs are tradable assets that keep track of who owns a certain digital item — say, a work of art, or video game avatar — on the blockchain. In a major way, they entered the mainstream consciousness last year.
An image of a digital collage created by Beeple. sold for a record $69 millionAt a Christie’s auction while famous collections such as the Bored Ape Yacht Club attracted celebrity buyers like Jimmy Fallon and Snoop Dogg.
Gauthier Zuppinger (co-founder of Nonfungible.com), stated that the company has seen “exponential growth” over the last year.
Nonfungible.com is estimating that there will be fewer total NFT transaction in 2021, than any other estimates. Chainalysis, a blockchain analysis company, had previously projected that the number would be more than $40 Billion.
Zuppinger states that this result is due to Zuppinger’s internal methodology for measuring NFT volume. Nonfungible.com excludes transactions involving bots or wash trading. This is a method wherein investors buy and then sell assets to artificially increase market activity.
NFTs are a useful way to prove ownership, but critics claim that the market attracts predatory behaviour. Participants are frequently encouraged to speculate on the prices. evidence emergingTheir increasing use of money laundering and other illegal activities.
Move to the metaverse’
Nonfungible.com research shows that more than 2.5million crypto wallets belong to NFT traders or holders in 2021. That’s up from the 89,000 found a year before. From 75,000, the number of buyers grew to 2.3million.
The report also revealed that people have become more successful at NFTs. In fact, NFTs were sold to investors for $5.4 billion last year. Nonfungible.com reported that more than 470 wallets earned profits of over $1 million.
Collectors were the most-sold NFT category, with $8.4 trillion in total sales. The second largest category of NFTs was gaming, with AxieInfinity announcing $5.2 billion sales.
The focus shifted to the metaverse later in the year, and sales of digital land were up by $514 million.
Hype around the metaverse — proposed shared spaces in which users can interact with virtual objects and each other — gathered steam after Facebook’sMeta and a rebrand Nike’sPurchase of RTFKT which creates virtual sneakers
The next step?
Zuppinger does not expect NFT transaction value to increase as rapidly in the future. According to Zuppinger, volumes are now at $687million per week for 2022. That’s slightly more than what was $620 million per semaine in the fourth-quarter of 2021.
Zuppinger explained, “What is fascinating is that there are fewer people, fewer buyers, and fewer sales.”
“Speculation and loss of interest may have caused a decrease in the global collectible community. However, the market for global collectibles is very large and some assets have seen an increase in value.
Zuppinger believes that more financial institutions and large corporations will be entering the market while more speculation assets are disappearing. There are many big brands like VisaNike and Adidas joined the NFT wagon in 2021.
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